Payments Blog

For merchants, the inevitability of chargebacks might make the entire situation seem dire. Unfortunately, you do need to deal with them and, since the consumer’s issuing bank wants to maintain a good relationship and reputation with their client (the cardholder), it might feel like you’re stuck in a continuous, miserable loop, where you can’t recoup any revenue, no matter the situation.

While it can be rare for a merchant to win a chargeback dispute, it does happen! If you’re a merchant, and you feel that a consumer has wrongfully filed a chargeback against you, you can dispute it, through chargeback representment. The act of representment occurs when the merchant presents a case to their acquiring bank, to attempt to recoup the funds they lost from the initial chargeback. There are, however, a lot of different things for merchants to consider before going through with this process.

It’s important to have a good understanding of the chargeback reason codes, so that you can understand why a consumer filed a given chargeback. These reason codes will provide insight into the consumer’s experience, and will help you determine whether you have a strong case for representment.

Additionally, you should keep all relevant information that could be used during representment, including purchase receipts, shipping and delivery receipts, business records and any other pertinent documents. During this process, timeliness is also vital. There is a specified time frame for merchants to decide whether they want to go forward with this process, which means you need to act quickly if you want to recoup your revenue.

Before going through with this process, you should also conduct a cost-benefit analysis. While you might want to dispute every chargeback that you feel has been wrongfully filed, you need to pick and choose your battles. During representment, you will dedicate a lot of time and resources to the process, which means you should only dispute cases where the amount of the transaction is significant. If you start disputing smaller transactions very often, you might end up losing, rather than recovering, revenue in the long run.

While representment can be an effective way to resolve a chargeback, it’s not the most effective way to prevent them. Cardinal’s rules-based authentication solution, Cardinal Consumer Authentication (CCA), leverages 3-D Secure to give merchants even more control over their transactions, which will help them prevent fraud and limit their chargebacks. With One Connection to Cardinal, we can Drive your Digital Commerce.

Welcome to the CardinalCommerce blog. Cardinal is a global leader in authenticating digital transactions, with One Connection to drive digital commerce. Our goal for this blog is to provide a platform that will inform and educate our Customers and partners on consumer authentication, payments, mobile commerce, solution design and big data.